The Federal Energy Regulatory Commission (FERC) approves almost every pipeline project that comes before it.
In March 2016, the Delaware Riverkeeper Network sued FERC, accusing the agency of routine bias toward the natural gas industry.
Last month, the group brought together citizens from around the country for a one day hearing at the National Press Club to testify about their experiences with FERC.
No mainstream reporters showed up, and only a few Congressional staffers.
But the testimony was posted on the web. And the Delaware Riverkeeper, Maya van Rossum, says that she will present the findings to Congress and continue to push for hearings on FERC bias.
“Congress has held hearings, but they did not look into how FERC is abusing its power,” van Rossum told Corporate Crime Reporter. “They are looking at various pieces of information. They are not looking at how FERC is abusing its power and abusing its laws. It’s not looking into the fact that FERC is stripping states of their legal authority to review pipeline projects.”
“Congress is not looking at how citizens are being denied the ability to challenge a pipeline project in court before their projects are being taken by eminent domain and before those pipeline projects are going into construction. Except for one project in Oregon last year, FERC has a 100 percent approval rating for all of the pipeline projects that come before it. It’s related to the revolving door. It’s related to the self dealing between the pipeline industry and the FERC commissioners. It’s related to the fact that FERC is 100 percent funded by the industries that it’s supposed to be regulating.”
“Congress is not looking into the fact that FERC has not issued a single penalty to a pipeline company for violations of environmental laws during construction, operation and maintenance. When serious and significant violations resulting in significant damage to the environment are ongoing, FERC doesn’t even come in and issue a stop work order, but allows the construction to proceed despite the damage that is ongoing because of violations. We have this abuse and bias and damage onto our environment and communities. And we have a federal agency that is demonstrably working for the pipeline industry against the people. That needs to be investigated by Congress.”
FERC did deny the Pacific Connector in Oregon. FERC found little evidence to support a need for the pipeline and said any public benefits were outweighed by negative impacts to landowners along its route.
That is a conclusion that FERC could reach about almost any of these pipelines.
“The justification used to deny the Pacific Connector project can work for certainly all of the pipeline battles we are involved in. These pipelines should be getting denied by FERC. But they are being approved. Based on my experience, FERC approval of a pipeline project is a foregone conclusion.”
Why did FERC deny the Pacific Connector?
“Ten days before they denied that project, the Delaware Riverkeeper filed a challenge to the FERC process. We claimed that the FERC review and approval process was a violation of the federal constitution. We cited in our complaint a whole bunch of evidence to substantiate our claim. Up until that time FERC had a 100 percent approval record.”
“They approved every pipeline project that went before it for approval. After we filed that complaint that highlighted that kind of evidence of bias, FERC started getting phone calls from reporters. They could not deny our claim. They tried to assert that we were wrong. They said on one project they had denied the Turtle Bayou Project. But that was not a pipeline project. They finally had to admit this. After ten days of being battered by the press for this 100 percent approval rating, all of a sudden, lo and behold, the Pacific Connector project was denied.”
“We think they denied it out of embarrassment and in direct response to our Constitutional challenge which is now proceeding through the courts.”
Where is it now?
“It’s currently before the DC Circuit and oral arguments are scheduled for March 2017.”
Who is handling the case for you?
“Aaron Stemplewicz — he’s on our staff and Jordan Yeager — he’s an outside counsel with Curtin Heefner– are the two lead attorneys.”
How is FERC unconstitutional?
“FERC is a biased adjudicator. The level of bias rises to be a violation of the Fifth Amendment of the U.S. Constitution. They are taking property without due process. It’s a combination of how FERC is funded, how it’s behaving, the fact that FERC has independent authority over decision making. FERC decision making is coupled with the power of eminent domain and pre-emption of state and local authorities. When you put it together, it becomes a clear violation of the Fifth Amendment.”
You say that FERC funding is 100 percent industry funded.
“FERC tells Congress how much money it needs. Congress fronts the money and FERC is obliged by law to pay it back by the end of the year. FERC charges fees on the pipeline companies. The amount depends on the number of applications and the volume of gas that passes through the pipelines. There is an incentive for FERC to approve the pipeline projects because it results in more funding coming into FERC. And as a result, each year they can grow their budget. As a result, while other federal agencies were shrinking, FERC was growing. The expansion of FERC’s budget far outpaces the expansion of its parent agency — the Department of Energy. This is an agency that is growing by leaps and bounds. And that’s because it writes its own check because it gets the money from the industry.”
You held your one day session in the National Press Building. Yet, there was little reporting on the hearing that you held. Why?
“It may have been timing. There was a lot of activity around Trump. Our target audience was not the press. Our target audience was Congress. And we did have representatives from the offices of Congress. About four offices were represented. But that is where we were disappointed. Despite the fact that all of these people from all over the country — from Arizona, from the West Coast — they came at great expense to Washington DC to make it as easy as possible for members of Congress to hear our stories, the members couldn’t find the time to come to the National Press Club and spend maybe one hour listening.”
“But we also pulled together a dossier of evidence that we will take into the halls of Congress once it is compiled, to make our case to members of Congress and their staff.”
Have you laid out what changes you would like to see?
“We are working on areas of reform. We want Congress to hear about how communities are being harmed and abused and the level of bias, how pipeline projects are being approved without proof of necessity. And yet the power of eminent domain is accompanying that approval. Congress needs to hear about those abuses. Right now, we need to get Congress to recognize that there is a problem they need to address. We see that as the focus of the hearing we are calling for.”
Should Congress fund FERC?
“It’s not unprecedented that agencies collect fees to help fund their operations. What is unprecedented is how FERC is set up — it gives the power of eminent domain to the pipeline companies, you have this pre-emption of state and local authority. There are a number of elements to FERC that creates the problem. Resolution could in part be addressed by the funding mechanism. But it also could be addressed by taking away that power of eminent domain and pre-emption.”
How would a pipeline be built without eminent domain?
“Like any other industry, they would have to go out and convince the property owners that it is a worthy project and pay them a fair price and negotiate a deal.”
“It’s corporate welfare because they get it on the cheap. They use the threat of eminent domain to browbeat homeowners into cutting deals prematurely and cutting unfair deals, giving away their property rights when they don’t want to give away their property rights.”
Many of these pipeline projects are being defeated. How does that happen?
“I assume you are speaking about Keystone XL and Standing Rock.”
There was one in New England that was defeated. There is the Palmetto Pipeline defeated by the Savannah Riverkeeper.
“And we defeated the Commonwealth Pipeline. We defeated that by getting the company to walk away. They saw how difficult a battle it was going to be for them. And the state of New York has said no to the Constitution Pipeline. But FERC allowed it to go forward prematurely, in violation of the law, before New York had given its approval.”
“There are some victories happening. But there are so many more projects moving forward. But it’s only a small proportion of pipeline projects that are being defeated. People in communities who want to defeat these pipelines are at an incredible disadvantage. While there have been some successes, the need for reform is incredibly important. The successes shouldn’t overshadow the reality that in the vast majority of cases, when a pipeline company proposes a natural gas interstate transmission line, approval by FERC is virtually a foregone conclusion. FERC approval is 99.99 percent certain.”
[For the complete q/a format Interview with Maya van Rossum, see 31 Corporate Crime Reporter 4(12), January 23, 2017, print edition only.]